A value engineering/investment utility model for project investment evaluation /
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| Other Authors: | , , |
| Format: | Thesis Book |
| Language: | English |
| Published: |
1989.
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| Subjects: | |
| Online Access: | Link to OAKTrust copy |
| Abstract: | The objective of this study was to develop a general conceptual model for a construction investment project that will accommodate a specific investment utility function for an investment entity in a practical, value engineering, job-plan-of-action framework. Value engineering (VE), as applied here, is a managerial technique which uncovers the functional requirements of a project or a system, tries to maximize them and emphasizes their achievement at the lowest total life-cycle cost. The worth of a project or a system, on the other hand, is largely represented by the utility it provides to the user or investor. The proposed model is a general, multipurpose, predominantly before-the-fact investment planning and control model based on a goal-oriented step-by-step systems approach philosophy which can (possibly with some minor modifications) be applied to any investment planning project or system. Two research hypotheses are presented and tested in this study. The first hypothesis is tested by applying the proposed model to a real-life case study on a post-audit basis. Sample data are used for the statistical testing of the second hypothesis concerning VE cost savings potential, as well as certain direct financial reward/investor risk preferences. The sample data are also used to generate rough investment utility functions subject to the limitations of a limited sample size. The results of the research were based on 37 personal interviews with knowledgeable individuals, representing owners of and investors in construction investment projects, as well as design and other consultants intimately involved with some significant dimension of construction investment projects. The results of the case study confirm the viability of the proposed model with its hypothesized VE cost savings potential. Moreover, the sample data confirm similar VE cost saving potential. However, it appears that this study failed to demonstrate that "risk-prone/risk-averse" behavior (as defined in this study under specific assumptions), relates to the weight an individual attaches to different types of direct financial rewards, which means that the second hypothesis is rejected. |
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| Item Description: | Typescript (photocopy). Vita. "Major subject: Urban and regional science." |
| Physical Description: | xxiv, 240 leaves : illustrations ; 29 cm |
| Bibliography: | Includes bibliographical references. |